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6 The Canadian Statesman, Bowmanville, Wednesday, January 11,1995 Section Two Max HAINES Crime Flashback - ! : • ' • X \" and his boys filled one small compartment of the tanks with oil. When the American Express auditors checked the tanks, they were led to do their soundings soundings in these compartments. compartments. The balance of the huge tanks was filled with salt water. Another cute little little ploy implemented by the creative Tino was to install a system of pipes between the tanks, which allowed the same salad oil to flow from tank to tank ahead of the American Express man. The cash poured in. During 1962, Tino converted $320 million in warehouse receipts into cash. At any given time, over $50 million was in payment for nonexistent nonexistent oil. Allied became the No. 1 exporter of salad oil in the United States. At one point, their records showed an inventory of more salad oil in Bayonne than existed in the entire country. No one noticed. The scheme could not go on forever. Tino realized its one flaw. While he had enough real oil for normal business, an extraordinarily extraordinarily large order would mean exposure, because as time went on his fictional oil was rapidly becoming most of his inventory. Tino decided to purchase oil on the futures market for very small down payments. payments. If the price went up, he could take delivery of his oil at a huge profit. profit. Of course, if the price of oil went down, he had to come up with the increased margin requirements within within 24 hours. In a short period of time, Allied had 22,600 contracts worth $160 million. If the price of salad oil dropped as much as one cent a pound, Allied would have to pay over $13 million million within 24 hours. The futures market market is a dangerous game. When commodity brokers began to limit Allied's credit, the Commodities Exchange decided to investigate Tino's operation. The scheme came tumbling down. After the smoke cleared, it was revealed that Tino's fraud approached $200 million. Chase Manhattan Bank bit the bullet for $30 million. American Express made good on $60 million worth of warehouse warehouse receipts. Other smaller organizations organizations went bankrupt. Tino was found guilty of fraud and sentenced to 10 years imprisonment. One of the greatest swindles in U.S. history never received the publicity it justly deserved. The case broke on Nov. 22, 1963, the day John F. Kennedy was assassinated. W hen Antony De Angelis was growing growing up in the Bronx, his hardworking hardworking Italian immigrant parents felt the boy had a natural propensity for the ecclesiastical life. They believed little Tino would become a priest. They were wrong. Tino became one of the biggest swindlers in the history of the United States. In 1931, chubby Tino quit school and went to work as a clerk in a large fish and meat market. Within three years, he was managing the firm's 200 employees. It is quite possible possible that a less ambitious lad would have remained a manager manager for the rest of his working working life. Not Tino. He moved on to the City Provision Co., a firm devoted to processing hogs. While in the hog game, Tino met Virginia Bracconeri, who fell hard for the short, charming ambitious ambitious lad. Within a year the pair were married and nine months later were blessed with a son, Thomas. In 1938, Tino took the plunge with $2,000 of his hard-earned savings and opened his own business, M and D Hog Cutters. It was one of those success stories you read about. In a few short years, Tino's outfit was processing 3,000 hogs a day. Now a millionaire, our boy had come a long way since leaving his parents' cold-water walkup flat in the Bronx. Tino recognized a golden opportunity opportunity when he saw it. In 1955, he left the hog business to get into salad oil. At the time, U.S. suppliers were selling oil to Third World countries, but were being paid cash on the barrelhead by Uncle Sam. Tino's outfit was christened the Allied Crude Vegetable Oil Refining Corp. He set up headquarters in a dilapidated building in Bayonne, New Jersey, smack dab in the middle of a sea of old petroleum storage tanks. Tino installed a refinery to convert crude vegetable oil into salad oil. He also made arrangements to clean up the petroleum tanks for his own use. Business took off. Tino purchased crude vegetable oil, refined it and sold the finished salad oil to large export companies, who shipped it to the capitals capitals of the world. His prices were substantially substantially lower than all his competitors. competitors. The nature of the business required large outlays of cash, which was provided by the export companies companies who made big bucks off Tino's oil. His largest customers were Continental Grain and Bunge Corp. To give you an idea of the size of the Tino made a fortune in phony salad oil operation, in 1958 Allied's annual sales were $200 million. Tino's organization was providing 75% of all edible oils being shipped out of the U.S. As head of Allied, Tino travelled to Rome, Madrid, Amsterdam and other cities of the world to finalize contracts. contracts. He possessed all the creature comforts which money and power bestow, including a mistress, 40-year- old Lillian Pascarelli. Lillian helped release those tensions which develop after three consecutive 16-hour days. In return, Tino, generous to a fault, saw to it that his Lil had her own luxurious luxurious home, a shiny new Caddy, fur coats too numerous to mention and a liberal monthly allowance. What fools these mortals be. A lot wasn't enough for Tino. Greed took over. We are all aware of American Express travellers cheques and credit credit cards, but the company does have other interests. In 1944, through a sub sidiary, American Express Field Warehousing Corp., the company entered the warehousing business. They took over the supervision of customers' customers' warehouses, guaranteeing that what was claimed to be in storage storage at the warehouse was, in fact, there. They could then issue warehouse warehouse receipts to the customers, who in turn could present the receipts to their banks as collateral for loans. Despite American Express' impeccable impeccable reputation, their warehousing operation lost money for several years. Tino paid a visit to the president of American Express Warehousing, Donald Miller. He invited the executive executive to visit his tank farm in Bayonne. Miller took Tino up on the invitation and was greatly impressed with the modern, stainless steel refining plant. The two men cooked a deal. American Express would take over supervision of Allied's inventory. They would issue warehouse receipts to Allied, who would turn them ovér to the export companies for cash. They in turn would put them up at their banks for collateral. In this way, everyone would be happy. Allied would get paid for their inventory immediately and American Express would receive fat commissions for the transactions. All concerned, including the largest banks in the United States, approved the deal. Tino was now in an enviable position. position. As far as he was concerned, American Express Warehouse receipts were the same as cash. All he had to do was present the receipts and receive a cheque. In theory the receipts were backed by oil in those tanks in Bayonne. American Express audited the tanks from time to time. What they didn't know was that Tino